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KOLKATA: ITC plans to expand its presence in fragrance business by foraying into newer categories and premiumising its portfolio this year, buoyed by its rise to becoming the second largest player in the deodorant and body spray market.

The tobacco-to-hospitality conglomerate has just forayed into perfume spray segment, having established its presence in deodorant and cologne spray segments with its Engage brand.

"We think fragrance is a category where there is huge potential for consumption to increase through adoption by new consumers," said Sandeep Kaul, chief executive (personal care business) at ITC.The fragrance business, where margins are high at 18%20%, can also help the company achieve breakeven in its personal care business faster.

As per market tracker Nielsen, while the overall growth in consumer spending on deodorants and body sprays declined to 5% in 2015, it went up by 25% for ITC.

ITC has around 10% share in deodorants as per Nielsen report for December, with market leader Vini Cosmetics' Fogg at 16% and No. 3 with Park Avenue at 6.5%. The overall market is Rs 2,300 crore.

Kaul said the slowdown in fragrance market is due to consumers limiting their purchase to not more than three bottles a year, which is expected to improve. "This is an opportunity for us and we are widening our portfolio," he said.

ITC plans aggressive digital marketing push for its latest launch - Engage perfume spray. The company has tied up with Google to roll out a consumer campaign whereby couples can send customised and exclusive video notes to each other on a real time basis. Kaul said this campaign will help the brand over come advertisement clutter and increase engagement.

He said the company is aiming for market leadership in fragrance business.

The focus on fragrance business comes at a time when ITC is pushing its other businesses hard to reduce dependence on cigarettes with legal cigarette consumption down due to recurrent price increases triggered by higher taxation. ITC is chasing a goal of achieving Rs 1 lakh crore revenue from non-cigarette FMCG business. Its packaged food business has already become profitable.